Legion files amicus brief in disabled veterans small business case

The American Legion last week called on the Federal Circuit to reverse a ruling that found the U.S. Department of Veterans Affairs isn’t obligated to set aside more contracts for veteran-owned small businesses, arguing the VA is subverting the will of Congress.

In an amicus curiae brief, the veterans’ support group contends that the VA is running afoul of the Veterans Benefits, Health Care and Information Technology Act of 2006, which it says requires the VA to use small business set-aside contracts when two or more businesses owned by service-disabled veterans can provide needed goods at a reasonable price.

The Court of Federal Claimsin November overturned a line of U.S. Government Accountability Office decisions, ruling the VA has broad discretion to implement the 2006 law because the statute was ambiguous and did not directly address the new “Veterans First” preference's relationship to the Federal Supply Schedules, which are generally exempt from small business contracting preferences.

The GAO and the VA have been at an impasse for two years, with the latter ignoring the GAO’s consistent findings that the 2006 law requires the VA to use small business set-aside contracts when there is competition for the contracts from service-disabled veteran-owned businesses.

Basically, what happened was that Congress passed two seperate laws aimed at getting Federal Agencies to give more contracts to disabled veterans. The goal was 3 percent, but it set this goal as aspirational. When these laws passed (1999 and 2003) they went back and looked at the numbers to see how the government was doing on this 3 percent goal. The answer was not well. From 2001 to 2002 the percent was 0.12 percent. In 2005, after the second one was passed, it still only managed about 0.5 percent.

So Congress went back, and instead of weak aspirational goals, it changed the law to read that the federal Department "shall award" contracts. (Instead of "may" award.) Now, despite the obvious requirement of the language, and despite the General Accounting Office telling VA "you have to do this", VA has decided that it doesn't want to, and thus it will not do so.

VA's argument is basically that they exceed the 3 percent (which they do*) and thus those requirements that they "shall award" doesn't apply to them. [* To clarify: VA is above 3 percent, the government as a whole is south of 1 percent. But the law specifies how the contracts are awarded, being over 3 percent for one Department doesn't exempt them.]

From our amicus brief on the case:

Alarmed by the VA’s refusal to comply with the law, two subcommittees of the House Committee on Veterans’ Affairs held a hearing in November 2011 and sharply criticized the VA for its unlawful overreliance on the FSS. Rep. Bill Johnson, Chairman of the Subcommittee on Oversight and Investigations, began by remarking that “[w]hen the VA cannot or chooses not to implement clearly written legislation, we have a problem. This is not rocket science.” Follow-up on the U.S. Department of Veterans Affairs Service-Disabled-Veteran-Owned Small Business Certification, Hearing before the Subcommittee on Oversight and Investigation, Serial No. 112-35, 112th Congress (Nov. 30, 2011). He explained that § 8127(d) “contains clear wording” and “straightforward language,” and that “it is difficult to understand the VA’s failure to correctly interpret this law.” Id. Further, he emphasized that “[t]he word ‘shall’ has a very, very explicit meaning” and “does not leave much to interpretation.”

At the hearing, the VA argued (as it did in the Claims Court) that it does not need to follow § 8127(d) because it meets or exceeds both its own and the government-wide goals for VOSB and SDVOSB participation. Countering that argument, Rep. Marlin A. Stutzman (Chairman of the Subcommittee on Economic Opportunity) observed that “the process in achieving those numbers has been painful at best.” Id. He also explained that meeting goals “is not the sole intent of Section 8127,” which had also charged the VA with “picking up part of the slack for the rest of the Federal Government,” including “the literally dozens of federal agencies who continue to fail miserably to meet even the three percent goal.”

It's startling that the VA, the Department tasked with making sure that disabled veterans are taken care of, chooses to interpret "shall" as "may" in an effort to avoid giving contracts to companies owned by the very veterans they are tasked with taking care of. Literally startling.

So anyway, The American Legion has filed an amicus curiae brief ("friend of the court") in the case Kingdomware Technologies v. U.S. in the Court of Appeals for the Federal Circuit. It's almost beyond belief that we even have to do that, but so it goes. I should have more on this in the future as the case is decided.

Comments

I applaud the Legions efforts to push this issue forward. As an owner of multiple 1-2 person “micro” businesses, one of which is a VA certified SDVOSBC, I can give you both a clear and current picture of the hurdles placed in front of true VOSB and SDVOSBC’s when trying to save the VA money. These hurdles are both systematic (unintended), as well as in some cases, purposely placed to protect long term vendor relationships for rather dubious reasons. But regardless of the reason(s) for this continuous shell game played by the VA, it is encouraging to know that at least one organization understands how important this issue is. If you want to reduce veteran unemployment, then empower veteran owned companies to grow and expand because vets hire vets. In my case, regardless how much money I could save the VA on recurrent purchases, I will remain a 1-2 man operation until the stranglehold of big business is broken on all Federal Agencies to include most importantly, the VA.
Caveat: For those of you who are already thinking of attacking my comments as “whining” or “self-promotion”, know this, I have never asked nor do I intend to ask that my government pay me more for the same items they can get from someone else. These are my tax dollars too we’re talking about. Conversely, I am only asking for an even playing field and if you think that the current situation is equitable, then I would submit you may be living in a bubble with a very strong tint on it…

The American Legion has taken an important and necessary FIRST step by filing the AMICUS BRIEF in the federal circuit court. The district court is simply wrong in its ruling and regardless what anyone who opposes the action says, it does a tremendous justice for veterans and give Veterans a voice on this issue. An Amicus Curie (friend of the court) brief is filed to help the court decide the issues before it. It is filed by a non-party who has an interest in the outcome. In the case of our veterans groups the issue we would want to address is the precedence of the Veterans First Program. The American Legion was SPOT ON - for filing! This is an important decision because if the Veterans First Program takes precedence over the Ability One Program - under FAR Part 8, it should also take precedence over Federal Supply Schedule (FSS). There were several other issues decided by the court in addition to the precedence of the Veterans First Program, these included jurisdiction and the importance that should be given to a VA policy position. As VOSB or SDVOSB the Veteran Community has a direct interest in upholding a preference for the Veterans First Program. Our Veterans group adds legitimacy to arguing for the Veterans First Program as a direct beneficiary and not merely arguing for a procedural advantage. The American Legion has done what was needed! As the largest, VSO the American Legion stands out front in supporting Veterans in Business and we absolutely applaud this monumental effort! We need more VSO's to take note of what the Legion has done and follow suit! It is very expensive to file lawsuits and we need our veteran advocacy groups to step up to the plate and continue the fight on behalf on countless veterans who so rightly would benefit from self-employment as an economic goal. Just to name a few off the top of my head - it will absolutely help Women Veterans who more often than not, carry full loads in numerous roles as caregivers to others, and to themselves. It will help them achieve attainable mental, moral and economic success in a relatively small start-up time doing what they have been trained to do from the military, and carve out a decent living for themselves and their family members. A significant number of Women Veterans are also married to military men; who are often deployed to far away places. Helping to create a situation where the military men/women veterans can be supported will greatly reduce the stress that a military member faces when deployed. It will also get the greatest number of our Veteran community, our Men, working again. These Men desperately want to regain their dignity while still being able to support their country! Self-employment is a very necessary tool in the toolbox and should not be taken lightly by the VA nor other federal and state agencies. Supporting the Amicus Brief is absolutely the RIGHT thing to do! It was a bold move on the part of the Legion and their actions should be lauded. The VA has been dead set against following what Congress intended - and that being "VETERAN FIRST"! Their actions have proven to us that no matter what rhetoric they spout - they have no intention of giving Veterans preference over Federal Supply Schedule (FSS) This is the fight that Tim Power took up on behalf of Veterans everywhere and we supported. In fact, the American Legion Legal counsel contacted Tim before he died and told him that they would write an "amicus brief" on this issue, and they did! These are very important issues and we can not be silent on this issue! KUDOS to the Legion!

This is a "elephant" of an issue. And we all know the old adage: "The only way to eat a elephant is one bite at a time"!

CONGRATULATIONS TO THE AMERICAN LEGION FOR SUPPORTING VETERAN SMALL BUSINESS - And all who disagrees with their action can go kick rocks!

Va has in fact been EXTREMELY good to me and my many Vietnam Vet Friends. Put me thru' Law School,
Medical Treatment has been exceptional, and Disability checks have NEVER been late. I doubt they could
run my Law Office for me ( a " business " ) and I don't expect them to run your business for YOU. I think
your sniveling and " bitching " is in essence disgust for your own incompetence? Give VA a break. That
is , " GET OFF THEIR ASS" !!! Hugh Patty, JD

»sergio noble said...Commander Helms,
I don't know what your background is, but I detect private industry experience, where employee conduct rules are cvered once a year, where malfeasance is not tolerated..Read comment

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